My understanding is that many do not consider homless shelters a dignifying place to live in: no private space, no private room, etc.
They'd rather live in their care or their tent where they have some "me" space, than in a shelter.
In Germany, for example, the government would pay for your rent before letting you sleep on the street, car, or tent. They don't consider shelters a dignifying place to live either, and having a sane place to live is pretty much a pre-requisite for being able to turn your life around.
Berlin models homelessness efforts on US program: https://www.german-times.com/with-the-us-as-a-role-model-ber...
Berlin opens hostel for homeless (NOT "me" space): https://www.architecturaldigest.com/story/berlin-hostel-help...
Half a decade ago, at least where I was there wasn't many homeless there, but the rents in Berlin have exploded since, so the situation might have changed there.
But well over half of homeless people are addicts, and a lot of these folks will bail out of much nicer arrangements simply because they're not allowed to drink or do drugs.
Does that mean addicts should live in misery?
Addiction is a disease, it requires resources to treat.
There is also a shortage, in some areas, of low income housing. I am not sure what it is like in Germany but developers don't want to create low income housing since it tends to be treated poorly and increases crime in the area. How does Germany deal with that or are the German homeless better stewards of the place they live?
It does not have to be an special "low income housing".
Refugees were initially moved into refugee camps, so you didn't see them in cities, and then they were and still are being slowly integrated.
Refugee camps are no place to for people to live, but if you are escaping from a war zone, they are better than staying in the war zone.
Germany does provide (1) housing and (2) a living way to unemployed inhabitants without unemployment benefits, see: https://en.wikipedia.org/wiki/Hartz_concept#Hartz_IV
Requesting it isn't hard. I know many highly educated people that suddenly had no income or were evicted, e.g., due to loosing all "student benefits" right the same day they finished university, including housing, being evicted a couple of days later. They got Hartz IV benefits in a matter of hours, which paid for an apartment and gave them 400 EUR or so per month for food and basic stuff (you can live an ok-ish life with that if housing is covered).
But most homeless I saw in the streets in Germany, which you can actually just go and talk to, didn't want to receive any help from the state, had psychological problems, didn't want to receive medical attention, etc.
Due to how the German system for this works, it is actually super hard to help these people. Still, in a sense, the people that are homeless in Germany, is because at least in some way, they want to. Since not being homeless - with the exception of refugees - is as easy as going by an office, signing a sheet of paper, and the government pays for your rent, heating, water, electricity, internet, clothes, work training, healthcare and on top gives you 400 EUR that you can spend however you want (food, or just booze, etc.).
For the refugees... Germany is tight on housing, and new developments are slow, so being 1 million houses short (for 1% of the population), and then taking 1 million refugees on top, their access to housing is improving very slowly. I'd say they are free to apply for asylum somewhere else, but pretty much everywhere else the conditions are much worse for them.
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For context, relative to Germany's population, the 1 million of refugees Germany took per capita would be similar to the US taking 4-5 million refugees, in a very short period of time. IIRC, the US took less than 20k refugees from a war-zone they are very responsible for. At least they are consistent: they don't care about their homeless, and they don't care about the homeless they create everywhere else in the world. Then they are surprised when the homeless that end up growing up in ISIS camps end up flying planes into their skyscrapers.
Homeless people don't "live" in shelters, they temporarily occupy them. Every morning the shelter kicks out the people that slept there and every evening people must queue to re-enter the shelter. Night-to-night, no one is guaranteed a bed.
This is not an "option" that enables meaningful participation in our economy and society nor does it facilitate the health and growth that is necessary for escaping poverty.
For example, it appears California is maintaining around 20% capacity utilization in shelters statewide on average.
Talk to the workers, and they'll tell you the main struggle is not running out of space, but getting homeless people in the door, because as you point out, shelter life sucks. You're absolutely right, one doesn't "live" in a shelter in any meaningful sense. They're not a permanent solution, and hardly even a temporary one.
